Boehringer Ingelheim once again showed stronger growth than the total pharmaceutical market in 2003. This was the tenor of the report presented by the international pharmaceutical group at its annual press conference in Ingelheim, Germany, yesterday.
Dr Alessandro Banchi, chairman of the board of managing directors, responsible for the corporate board division pharma marketing and sales, described the company’s business development as dynamic and positive: "Once again we posted sound growth which is not so far behind the excellent business year of 2002."
Dr Banchi explained that Boehringer Ingelheim last year ranked sixth among the top 20 major international pharmaceutical groups in terms of market growth. According to the figures of the pharmaceutical market research institute IMS, Fairfield, USA, which concentrate primarily on prescription medicines, Boehringer Ingelheim posted 12.1 per cent growth, compared with a market average of 9 per cent.
On the US market, the company’s most important market, Boehringer Ingelheim posted a remarkable 16.1 per cent increase, according to IMS, (market average 11.1 per cent), with an increase of 12 per cent in Europe (market = 8.1 per cent) and 4.8 per cent in Asia/Australia/Africa (market = 4.9 per cent). Growth in Germany amounted to 9 per cent, or 0.5 percentage points above the market.
Prof. Marbod Muff, member of the board of managing directors responsible for the corporate board divisions finance and human resources, painted a positive picture of the future development of the company.
Although sales in 2003 were 2.6 per cent lower at 7.4 billion euro (2002 = 7.6 billion euro) and operating income as much as 16.7 per cent lower at 901 million euro (2002 1.08 billion euro), this was due to the strength of the euro and mainly to planned investments: into the strong increase of sales force and in important new products. However, following adjustment to take account of currency rates, that is to say in the local currency of the respective markets, Boehringer Ingelheim posted growth of 7.8 per cent. At 537 million euro, income after tax only fell slightly short of the year-ago figure (551 million euro).
The company expects a rise in sales of over 10 per cent in local currency in the current business year. Although Prof. Muff mentioned the "planned sales reduction" to be continued through 2004 in the wake of high advance investment in the future growth of Boehringer Ingelheim, the medium-term plans show again a "steady increase in earnings power" and hence continuation of the dynamic sales development of recent years. Again, Boehringer Ingelheim was able to increase the value of the company considerably over the last year.
There was also a marked rise in the number of employees in 2003 with an increase worldwide of 7.5 per cent to a total of more than 34,200. That is around 2,500 more than a year ago. Of these, some 600 were recruited in Germany, where the total is now almost 9,900. This was due less to the market environment in Germany, which Boehringer Ingelheim described as barely conducive to innovation and investment, than to new products, such as Spiriva or Micardis Plus and the expansion of biotechnical production in Biberach, in which Boehringer Ingelheim invested 255 million euro, giving rise to almost 400 new jobs. Biopharmaceuticals is one of the company’s economically most successful business segments.
Patented products account for an increasing percentage of the product portfolio of Boehringer Ingelheim. While these accounted for less than 30 percent at the end of the 1990s, they accounted for 44 percent by 2003. Next year, this figure is expected to rise to over 50 per cent. New products such as Spiriva or Micardis have still to exploit their full sales potential. Dr Banchi described the situation of Boehringer Ingelheim as "extremely comfortable".
Although spending on research, development and medicine was reduced last year by around 10 per cent to almost 1.2 billion euro, the currency component again played a central role here. If R&D spend is seen in relation to the Prescription Medicines business segment, which accounted for the bulk of expenditure, then R&D spending again corresponded to over 20 per cent of sales Dr Banchi explained. He described Boehringer Ingelheim as a "research-driven company" whose interest focuses on the research and development of new products for patients.
The best selling product in 2003 was once again Flomax/Alna (tamsulosin) a drug to treat benign enlargement of the prostate which, with growth of over 16 per cent, totalled 880 million euro (2002 = 756 million euro). The selective alpha-1-receptor antagonist is market leader in the USA and still offers further sales potential.